Experts warn of Renters (Reform) Bill eviction loophole

Experts warn of Renters (Reform) Bill eviction loophole

9:44 AM, 14th May 2024, About A week ago 23

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Private rented sector experts have identified a loophole in the Renters (Reform) Bill that could lead to a confusing patchwork system for landlords and tenants over evictions.

The Bill, which aims to abolish Section 21 ‘no-fault’ evictions might not deliver on this promise.

That’s according to Oli Sherlock, the managing director of insurance at Goodlord, and Ryan Heaven, a solicitor at Dutton Gregory Solicitors.

Their analysis suggests that despite a pledge from Michael Gove, the housing secretary, to end Section 21 before the next General Election, some landlords could still use it.

Section 21 would be ‘outlawed’ before the election

Mr Heaven said: “A lot of people place emphasis on Michael Gove stating that section 21 would be ‘outlawed’ before the election, but when you examine the Bill closer this is not what will happen.

“Whenever the election date is there will be some landlords in this country who will still be able to serve a section 21 notice even if others are not able to.”

Essentially, the Bill will create three broad tenancy types – and one of them will allow Section 21 enforcement:

  • A new tenancy created after the Bill has been implemented: Landlords won’t be able to serve a Section 21 notice after this date
  • Any fixed-term tenancy that becomes periodic once the Bill has been implemented: Landlords would still be able to serve a Section 21 notice until the tenancy switches over to a periodic one. However, once that happens, the new rules apply, and landlords can’t serve a section 21
  • Tenancies that are periodic when the Bill is implemented: For these tenancies, landlords will still be able to serve a Section 21 until the Government reviews the court system, reports on it to Parliament, and then sets an ‘extended implementation date’ at which point the new rules all apply to all tenancies.

This final scenario will see landlords being able to serve a Section 21 notice after the election.

‘Apparent promise to delay the scrapping of Section 21’

Mr Sherlock said: “As the Bill currently stands, it seems that the apparent promise to delay the scrapping of Section 21 to allow for court reform is not what it seems.

“Instead, it appears that the market will be delivered a fragmented process which sees some tenancies permitting Section 21, some not, and others that could fall into either camp depending on how a tenancy renewal is handled.

He added: “This would all be taking place alongside an investigation into the courts, which currently has no confirmed timeline or identifiable metrics for success.

“The deep irony here is that the very same courts will be managing more and more cases deriving from tenancies where section 21 has already been outlawed.

“Arguably this is the worst outcome for all parties.”


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Comments

GlanACC

9:52 AM, 14th May 2024, About A week ago

... Unless you have to issue a new tenancy agreement to all tenants which may be forced on us by the bill (who knows) .. look what happened in Wales

Reluctant Landlord

9:55 AM, 14th May 2024, About A week ago

we all know the RRB is totally flawed...only the nearer it gets to implementation, the more obvious the issues are becoming to those now taking an interest....
Landlords know this is going to be a tsunami - the wisest ones are already working out what the best scenarios are to issue a S21.
Many might be issuing one just because it keeps their foot in the door so the option its not completely taken away. I shall be issuing some and keeping them on a backburner. There is still no requirement for a LL to progress to accelerated after expiry but at least you retain the option. That's another 6 month period to see what happens and then if you have to follow it up then at least you can. I'm definitely keeping all options open for as long as possible and may actually hold off letting a new property at all if it is closer than 4 months before it is implemented.
If every LL does the same the whole rental sector is going to grind to a halt even before it goes live. No one is going to take on benefit tenants especially. Imaging the chaos then.....

Luke P

10:04 AM, 14th May 2024, About A week ago

Reply to the comment left by Reluctant Landlord at 14/05/2024 - 09:55
But that ‘backburner’, unlike days of old, isn’t infinite. I think it’s six month’s validity now…which I suppose is better than nothing.

DPT

11:34 AM, 14th May 2024, About A week ago

I think that the surprise for most landlords will be the fist two scenarios, not the third.

northern landlord

13:27 PM, 14th May 2024, About A week ago

What’s the betting that ALL section 21 notices will be banned before the court system is streamlined (if it that ever happens)? After all it’s only landlords who will be inconvenienced and out of pocket and nobody cares about them because they are all rich bloodsuckers who have a reckoning coming to them according to popularised opinion.

Cider Drinker

13:32 PM, 14th May 2024, About A week ago

Landlords rarely seek possession of a property for no reason.

The reason may be one that would be covered by the cumbersome Section 8 process and Section 21 is considered a ‘cleaner’ method. It may be one that is, as yet, not covered by Section 8.

But there will be a reason.

The Government, of course, know that landlords will sell. This is why they reduced CGT allowances.

I’ve started the selling process.

Reluctant Landlord

15:12 PM, 14th May 2024, About A week ago

well if this all goes ar$e up and the best way of gaining mandatory possession to get a nightmare tenant out (without the T being able to lodge a defence), is by using the S8 selling clause or moving a relative in, then so be it. It still doesn't mean I have to sell at the end of the day. I could just sit and wait it out....

There will come a point when the tables will have to turn again because the consequences of the RRB and all the 'pro tenant' initiatives, WILL directly hurt those it proports to help.

The worm will turn!

Reluctant Landlord

15:19 PM, 14th May 2024, About A week ago

Reply to the comment left by Cider Drinker at 14/05/2024 - 13:32
it will be telling when we actually see sight of the 'new' S8 form itself.

I am hoping that you will be able to tick all the clauses that apply as to why you are seeking possession. It would be great for every LL to go for the mandatory selling/letting to family clause but in addition being able to tick the rent arrears/asbo/other box and being able to give further details here. Might be quite telling if some LL's state they are going for a mandatory ground eg selling up directly because of rent arrears/asbo etc meaning they cannot carry on.

Everyone is demanding there has to be a reason given - be careful what you wish for....

PH

15:57 PM, 14th May 2024, About A week ago

I'll be looking for the "UK GOVERNMENT OUT OF TOUCH WITH REALITY" clause but I won't hold my breath.

Reluctant Landlord

16:22 PM, 14th May 2024, About A week ago

Reply to the comment left by PH at 14/05/2024 - 15:57I think they are fully aware of the reality - the reality is there are not enough social homes and there is never going to be....so...all attention to be switched to the evil private landlords that have come into help fill the obvious void. We have tenants screaming, so we need someone else to blame.....perfect diversion tactics away from their own failings.
The issue is it is going to get a whole lot worse and then suddenly the reality will dawn for tenants....they have been shafted by the enemy from within....
As part of my 'educating tenants' for everything I need to do regarding the tenancy I end with the line ' this is what I am legally mandated to do'. I make it very clear if they think anything about the rental process is unnecessary/unwarranted/intrusive/expensive/unjust then they need to contact their MP.

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